So what happened on August 5th that caused the market for every battleground state to spike for McCain? Surprisingly, the answer is not entirely obvious. All things considered, the best I can come up with is this: "McCain makes a last-minute purchase of $6 million in Olympics ad time, topping Obama’s $5 million buy." (From thepage)In addition, Rasmussen and Zogby released polls on 8/4 in which McCain lead.
Which of these is the real market driver is a significant question for determining just how political prediction markets are going to work. Are the prices driven by those with a deeper understanding of the process, or are they merely a lagging indicator of recent poll results?